Robinhood's first-quarter earnings report fell short of expectations, with the company posting adjusted earnings per share of $0.38, below the estimated $0.39, and total revenue of $1.07 billion, missing the projected $1.14 billion. The company's stock price dropped approximately 8% in post-market trading following the release of the report. A notable decline in cryptocurrency-related revenue, which decreased by 47% to $134 million from $252 million in the previous year, was a major factor in the earnings miss.
However, the company saw significant growth in other areas, including a 320% year-over-year increase in 'other transaction revenue' to $147 million, driven by a record 8.8 billion contracts traded in prediction markets. CEO Vlad Tenev emphasized the company's focus on utilizing cryptocurrency technology as infrastructure for financial services, rather than relying on crypto price cycles. The results highlight a shift in user engagement, with more consistent activity across asset classes.
Robinhood is working to expand its services, including prediction markets, derivatives, and advisory tools, to reduce its dependence on cryptocurrency trading revenue. The company also reported gains in net interest revenue and subscriptions, as it continues to build a broader financial services platform.